How to Build a Startup That Can Attract the Heart of Investors? By sharingAndyZain

The article below will explain and give you some insight, tips, and tricks in attracting investors so that they are confident and interested to invest in your startup. The contents of this discussion comes from startuplokal meetup which took place on 26 June, with speaker Andy Zain. Andy explained the various reasons that make investors that could be interested in your startup, how to establish potential business so that investors are willing to put their money in your business. Happy reading!

“Who said that building a startup it’s an easy thing? Data show that 85 percent of startups fail in just 18 months, “said Andy. He stressed that if you already know that your startup can not run at least six months, the better you immediately change business models, pivot, or building a new startup wait longer than 18 months duration only to realize that your business can not run or failed. Andy said, “There is no point in you waiting a long time (18 months) just to prove the performance of your business models, if six months can not walk, you should close your business as soon as possible and start something new again,” he said.

It is a new startup company that is still looking for identity or the right business models that could someday be a repeatable and scalable business, as said by Steve Blank:

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In the course of building a startup, you’d still be looking for the right business model, and therefore a lot of startups that pivot before they achieve success. The startup journey berlika and turns before they find the right business model and success. However, Andy suggested that you (Indonesian people) do not ever compare building a startup in Indonesia is similar to building a startup in Silicon Valley because the climate was much different. In that sense, America is far more advanced than our country. And Andy is also suggested that you do not often read Techcrunch or media technology in the United States fear that it will only create something that is delusional or mere wishful thinking.

“I do not want a lot of people who suffer the same fate as I did in 2001 ago. At that time I build a startup that sells airline tickets online (same as tiket.com now), but unfortunately this startup could not walk and had to be closed because no one is willing to buy tickets online, uh no, yes, no … But only three seed, “Andy said with a laugh.

This is a startup that built eTravel8. He built this startup purely as fascinated to see the success of Expedia, which sells tickets online. At that time, in Indonesia there is no e-ticket and the flight ticket are allowed to print only the flight airline ticket agents and eight flight. He realized this is wrong because at that time the technology is not adequate and there is no Indonesian people who want to buy tickets online. And with more or less the same idea, Tiket.com can be successful as it is now. With his experience, he does not want a lot of Indonesian people who seem to suffer the same fate.

So, how do we build a successful business and minimize the risk that investors can be confident and willing to invest in our business? Previously, you had to know that the VC (Venture Capital) and other investors, particularly in Indonesia, it does not want to invest in a business that has not been proven in other countries because the risk is relatively large. Better you build a business in a field that has not been touched or not there are players in Indonesia but there is already evidence that the business you run is a success in other countries. It could increase the success rate of your startup to get funded investors.

There are four factors that determine the failure in a startup, but if you can minimize these factors, Andy sure that your business can be funded by investors and great success in the future. The four factors are:

1 Business Risk Model

It is the risk arising from your business models. How to minimize the risks in the business model? Andy suggests that you should run a business model that clearly, easily made, and has been proven in other countries. Do not be consumed with the hype and the trends bandwagon is going on in America, such as 3D-Printing, Self Driveless Cars, and so on because Americans are far more advanced than Indonesia 8-10 years. If it is done in Indonesia, according to Andy, of course will not work. “Do not be me 14 years ago, be Natali Ardianto (CTO Tiket.com) are present. With business models, market, and execution of appropriate technology, Tiket.com can grow very fast. And do not most read Techcrunch. “(Read Startupbisnis.com also yes – ed).

“In looking for an investor, you should adjust with your business industry. If you move in the world of gaming, yes looking for investors who understand very well in the world of gaming. And also, not all investors are like new because new things are usually more at risk, so look for the old big market but not many people worked. Indonesia is a huge market, try to find loopholes that could be exploited as a business here, “said Andy.

Andy also said that it should not be too creative people who lead by creating something that is very complicated. Just do a simple and easy thing because basically, as a first-time entrepreneur, you need to learn before achieving success and managed to build a great company.

The best way to reduce risk in business is to replicate the business models that have been run in other countries, particularly in the United States about 10 years ago because of the internet business industry in Indonesia is lagging about 10 years.

2 Market Risk

Startup can also fail due to small market size. To run a sustainable business that can go to a big market and also potential. As explained previously, the market in Indonesia is still a lot that has not worked, try to find loopholes and exploit it as a gold mine for your business.

3 Risk of Execution

No matter how good your business idea, if you can not make it happen, the idea will remain just be wishful thinking, without ever becoming a real product. In building a startup, there are certainly risks in executing product that can glide on the market soon. To menimilisasi risk in the execution, build teams competent in their respective fields. Collect the people who you feel is competent to work with building companies, such as what is done by Cekaja where they recruited one of the co-founders in Check24 who have experience in establishing a price comparison site financial products.

Not only gather and invite people who are competent in building a startup, as a first-time entrepreneur, you obviously do not have much experience in building companies. So, to minimize the risk, get up product or business that you can easily do so immediately enter the market and test your products directly in the market. Working closely with a competent person is the best option to be done in building a startup.

4 Risk Technology

Technology is an element that is fairly easy to overcome because it is basically the implementation of the technology was not so hard. You can mimic another company’s technology and apply it in your business.

conclusion

By applying and minimize all risks above, your business opportunity to be accepted by the investor will be better because of your business potential, it means good business model, the market is huge, your team is competent, and the technology is not so complicated. Andy also said that you also have to understand the existing investors in Asia, particularly Southeast Asia. Investors here are not so suksa business models are too complex and creative.

“Indonesia or even Asia was different from the Silicon Vallley, very much different. So do not equate building a startup here with Silicon Valley. Do not build a business that is very complicated and too creative where the results will not be accepted by the market, especially in Indonesia. Do not ingested hype in America because I often find people who fell for the hype Indonesia by building a business that is not in accordance with the local market. Build a business that is easy, simple, clear, and has been proven to increase the chances of your business in order to be accepted by investors and markets. The Indonesian market is vast and there are many opportunities, take advantage of it. Finally, I repeat, do not often read Techcrunch, “said Andy.